According to the latest CoreLogic Report on home price information in the United Statesthe value of the houses increased 8.2% nationwide in the last twelve months. The dramatic increase occurred when the inventory of homes for sale reached historic levels, at the same time as buyer demand was driven by record mortgage rates. Such asCoreLogic explained:
"Home price growth remained consistently high throughout 2020. Home sales for the year are expected to register above 2019 levels. Meanwhile, the availability of homes for sale declined as demand increased and coronavirus (COVID-19) outbreaks continued across the country, which delayed some sellers from putting their homes on the market.
While the pandemic has left many in positions of financial insecurity, those who have maintained stable employment and income are also encouraged to buy due to the record low mortgage rates available; this is increasing buyer demand while the inventory for sale is in short supply."
Where will home values go in 2021?
House price appreciation in 2021 will continue to be determined by this imbalance between supply and demand. If supply remains low and demand high, prices will continue to rise.
This movement has made investors excited about increasing their real estate portfolio, buying more houses in the United States and "guaranteeing" a sharper appreciation in the early years.
Housing Supply
According to the National Association of Realtors in the United States(NAR), the current number of single-family homes for sale is 1,080,000. At the same time, last year, that number was 1,450,000.
We are entering 2021 with approximately 370,000 houses for sale less than that there was a year ago.
However, there is some speculation that the stock drop will slow down a bit as we move into the new year for two reasons:
1.As the health care crisis subsides, more homeowners will feel comfortable putting their homes on the market.
2.Some families financially affected by the pandemic will be forced to sell.
Demand for real estate in the United States
Low mortgage rates have boosted buyer demand over the past twelve months. According to Freddie Macthe rates were at 3,72% in early 2020. Today, we are starting 2021 with rates of one full percentage point smaller than than that, i.e. 2.82%. Low rates create a great opportunity for home buyers, reason whereby demand is expected to remain high through 2022.
Taking into account these projections about housing supply and demand, real estate analysts predict that housing will continue to appreciate in value in 2021, but that appreciation may be more stable than last year. Here are their predictions:
There are still a very limited number of homes for sale for the large number of buyers who wish to purchase them. As a result, the concept of "supply and demand" dictates that home values in the country will continue to appreciate
Are you in doubt?
Now that you know a little more about how the housing market in Orlando should behave in the year 2021. We can help you understand the behavior of the real estate market so you can consider investing in vacation homes in orlando. To take advantage of all the tips we have brought to you and to go even deeper, you can talk directly to our relationship agents. They are always happy to talk to you with any questions you may have about investing in Florida.
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